Proposed Ryan budget protects wealthiest

Rep. Paul Ryan, chairman of the House Budget Committee, unveiled his current budget plan on April Fool's Day. This plan is intended to cut $5 trillion in spending over the next decade and produce a balanced budget by 2024. The plan makes steep cuts to Medicare and food stamps, and reduces domestic programs, including all leve...

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seacoastonline.com

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Posted Apr. 21, 2014 at 2:00 AM

Posted Apr. 21, 2014 at 2:00 AM

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April 10 — To the Editor:

Rep. Paul Ryan, chairman of the House Budget Committee, unveiled his current budget plan on April Fool's Day. This plan is intended to cut $5 trillion in spending over the next decade and produce a balanced budget by 2024. The plan makes steep cuts to Medicare and food stamps, and reduces domestic programs, including all levels of education and financial support for small businesses, to their lowest levels since modern government accounting. The plan also calls for total repeal, not just revisionary improvements, to the Affordable Care Act, just as millions are reaping the benefits of the law. Defense spending would increase, without a clear military strategy from Mr. Ryan, and people 65 and older will be required to rely on the financial markets for health care.

Mr. Ryan assumes that his budget would prompt an increase in economic growth by raising tax revenues. However, he also does not adjust the revenue ledger to reflect the cost of repealing the ACA tax increases and the Medicare part C (Medicare Advantage plan) cuts. The combination of which, with repeal, are estimated to eliminate a planned revenue increase by about $2 trillion. Mr. Ryan seems to ignore the fact that uninsured citizens will get their health care through clinics and emergency rooms, which the rest of us pay for one way or another. To date, more than 10 million people have gotten health insurance through the ACA, either through private policies purchased on the insurance exchanges, through expanded Medicaid, or private policies bought from brokers but subsidized by the law. Here we see an example of the free enterprise system working with help from Uncle Sam.

The Ryan budget protects the wealthiest of Americans and big business. The wealthiest people will enjoy tax loopholes and an average tax cut of $200,000 per year, all the while cutting, slashing and burning our entitlement programs — programs that we are entitled to because we contributed to the Social Security, Medicare and retirement benefits during our working years. Furthermore, the Ryan budget will result in the loss of 3 million jobs by fiscal year 2016, almost the entire work force of Wisconsin.

I fully agree with the concept that the wealthiest of us and big business should be incentivized to invest in growth opportunities. However, that is only half of the economic equation. We still need a major portion of the population to take advantage of the opportunities by purchasing the products and services offered. If, as the Ryan budget does, you drive the middle class and small businesses deeper into the lower end of the economic spectrum, then there is declining demand and declining tax revenues. Demand creates the jobs from the opportunities generated by the supply side, providing the demanders have the financial ability to demand.

So, who suffers from the Ryan budget? The Gallup Poll suggests that 3 percent of Democrats, 1 percent each of Republicans and independents identify themselves as being in the upper class. Considering themselves in the upper-middle class are 16 percent of Republicans, 21 percent of independents and 33 percent of Democrats. The Gallup Poll also tells us that 37 percent of Republicans, 33 percent of independents, and 28 percent of Democrats earn more than $75,000 and have some ability to invest and demand, thus spurring the economy. The remainder of the population is struggling to survive. The remainder of the population, Republicans, Democrats, and independents and not registered, will suffer more under the Ryan budget.

Congressman Ryan's motivation is either 100 percent conservative politics, or he is naive and does not understand real-world economics.